Taxes

Kingstonian tax breaks endorsed by city Finance and Audit Committee

(Photo provided)

Members of the Common Council’s Finance and Audit Committee have expressed their support for a payment-in-lieu-of-taxes plan for the Kingstonian mixed-use development project, which will be considered by the full council Tuesday. Local input into the plan to provide $30.64 million in tax breaks was sought by members of Ulster County’s Industrial Development Agency because the plan departs markedly from the standard PILOT agreement. Project developers are offering a number of novel terms, including commitments to scholarships and internships for public-school students, sharing of excess profits, and bathrooms and parking spaces that will be available for public use. If approval is granted by the common council, the PILOT will be considered at the IDA meeting on Aug. 12.

The $58-million project, to be located on the extension of Fair Street between Schwenk Drive and North Front Street, would provide some 277 parking spaces that supporters feel are critical to economic revitalization uptown, and in the city as a whole. Drivers would be able to pay a projected $1.50 an hour to park there or buy a monthly pass for an expected $60 a month to have access to the lot. The remainder of the 420 spaces would be reserved for Kingstonian residents. Developers have proposed that they will pay $100 monthly for that dedicated spot, or half that if living in one of the 14 units designated “affordable,” which will be rented at below-market rates. There is no law requiring affordable apartments be included in developments in Kingston.

Beyond parking, the project would have a total of 143 apartments, 32 hotel rooms, 9,000 square feet of retail space, and pedestrian bridge across the street to the Kingston Plaza, which is owned by Herzog’s Supply Co., the president of which is also a principal of this project. Parking in that plaza would remain free.

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Developers Kingstonian Development LLC and JM Development Group LLC have applied to have $28.84 million in property taxes to be waived over 25 years, along with another $1.8 million in sales, mortgage, and use taxes. They would continue to pay the current property taxes on the property, with an increase of two percent annually, for the duration of the agreement. The terms they are seeking include the construction and ongoing maintenance of the parking garage along with a pedestrian plaza and unisex bathrooms, paying employees at least $15 hourly, contributing $50,000 over 10 years toward a scholarship fund to benefit students of the Kingston Central School District, two internships—pegged at $10,000 annually—for public school students for the life of the agreement, and sharing of three percent of excess profits with local taxing authorities should financial projections be exceeded.

Committee members were largely enthused with the project, although the ninth ward’s Michele Hirsch felt strongly enough that taxpayers should get more out of this agreement that she cast the lone dissenting vote. Hirsch was concerned about revenue lost to the public including that from parking, but other committee members focused on the fact that parking is precisely what was sought in a 2016 request for proposals, and predicted that sales tax revenue in general would rise over time thanks to that garage.

This article was originally published on Hudson Valley One

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